Michael Novogratz Discusses the Future of Cryptocurrencies

Novogratz thinks that today a successful crypto company needs to “long the ones who you think are going to be able to build communities and short the ones who are not”.

Michael Novogratz, CEO and founder of Galaxy Digital Management, and one of the most notable persons in crypto discussed the future of digital currencies and their effect on future investments.

At the beginning, Erik Schatzker, the host of the discussion event, organized a poll among its audience asking to complete the sentence “Cryptocurrencies will be…” with the following endings; percentage corresponds to the number of people who agreed with it:

bigger than the Internet. (16%)

disruptive but mainly to traditional banking. (32%)

something like digital gold. (16%)

a speculative fad with no intrinsic value whatsoever. (37%)

The poll was taken to get the current mood of the audience about cryptocurrencies. As we see, answer D has been chosen by the most of audience, showing that there are many cryptocurrency skeptics. Significant percentage of audience also chose answer B, which also has pessimistic view on the crypto.

Novogratz is known as leading Bitcoin and cryptocurrency believer, who quit his career in Wall Street and occupied himself in digital assets field, being confident that some people might change their minds after his words:

“I see this crypto revolution as Internet 3.0. And the internet really did change everything about the way we live. And I do think that in 15 years we will look back and blockchain will have changed a ton… It is going to be pretty big.”

Nowadays blockchain technologies attract many talented people as they have plenty of ways be applied in. But from a certain point of view, their application creates potential risk to a lot of industries. Novogratz thinks that today a successful crypto company needs to “long the ones who you think are going to be able to build communities and short the ones who are not”.

These words mean that the company must possess a big user base and strong developer community. Answering the question about the blockchains that will withstand many stresses, Novogratz states that Bitcoin, Ethereum, EOS, and Telegram will remain on the market for a long time. Novogratz thinks that Bitcoin “is going to be around for a long time and it is going to be decentralized gold, but it will not be the blockchain that all the cool stuff gets built on.”

Many experts compare cryptocurrency success with internet revolution, although Novogratz thinks that crypto revolution is many ways different. The point is crypto revolution is global only in one aspect as only the rich and upper-middle-class citizens of US, for example, are able to invest in internet companies in the early stage.

It is not the time yet to talk about economic boom of crypto as the total market valuation is still too low to name it a cryptocurrency market bubble. Novogratz notes that the combined total market capitalization of all coins and crypto companies has been $1.2 trillion as of January 2018. Just to compare, the internet bubble in 2000 was estimated at $6 trillion, and the current crypto boom is way too far from it. “This [Cryptocurrency market] will feel more like a bubble when we reach $20 trillion,” Novogratz added.